ABSTRACT
Our attempt to explain the nature of the invest ment cycle and the operation of its basic cause in its purest form makes use of a general quan titative model of economic development, con structed for this purpose. Starting from the basic conception of development of the socialist economy, our model takes into account f irs t of all the role of technological progress as the most important dynamic factor in and the strong est momentum of economic development, as well as the special importance of the production of capital goods (from the standpoint of impact on the rate of economic growth, the formation of m aterial accumulation, and the creation of the m aterial basis for new technology),and the neces sary variability of growth rates of the two basic departments of social production and of the various branches within them.
